Sunday Telegraph: Profile: ‘Browne took BP into premier league’

By James Bamberg

Lord Browne was a transformational leader of BP, but it should never be forgotten that he enjoyed a superb inheritance when he became chief executive in 1995. Under his predecessor, Lord Simon, BP had been turned into the leanest, fittest and best performing oil company in its league. The only problem was that the league was not the premier division.

Ever since BP’s birth in 1909, during the first era of globalisation before the First World War, the company had played third fiddle to Exxon and Shell, the first movers in the globalisation of the oil industry. BP had hardly got started when the global economy was fractured by the Great War, the Russian revolution, the Great Depression, the Second World War and growing economic nationalism in the Opec countries.

In this fragmented world, BP was never able to make the leap from being an international company to a global one. Not until the fall of the Berlin Wall in 1989 did we see the dawn of a second era of globalisation that offered new opportunities for global expansion comparable with those that had existed before the First World War.

Browne’s supreme achievement was to spot and seize the once-in-a-century opportunities to transform BP into a truly global player, joining the premier division of oil and gas companies alongside Exxon and Shell. In 1989, as the Berlin Wall was falling, Browne, at that time the head of BP’s upstream oil and gas business, seized on the implications and launched a new strategy of frontier exploration.

BP, previously dubbed the “two pipeline company” because of its dependence on oil from mature fields in Alaska and the North Sea, blossomed into a highly successful global explorer and producer of oil, hunting for hydrocarbons across the world from Azerbaijan to Angola.

After becoming chief executive, Browne went further, addressing not only the need to find new sources of hydrocarbons but also the global consequences in the form of climate change. In 1997 he famously broke away from the rest of the oil and gas industry in declaring his concerns about the need to take precautionary action before it was too late. His ground-breaking speech initially made him a pariah in some oil industry circles, but earned him plaudits from environmentalists.

Denis Hayes, who co–ordinated the first “Earth Day” in 1970, said Browne’s stance was akin to “the head of Greenpeace endorsing commercial -whaling”.

But perhaps the most lasting monument to Browne’s time at BP came between 1998 and 2002, when the company was transformed into a new “super-major” through a series of cross–border mergers and acquisitions. The first was the merger with Amoco, at the time the largest industrial union in history. Then came the absorption of Arco, America’s seventh-largest petroleum company, followed by the takeovers of Burmah-Castrol, Britain’s oldest international oil company, and Aral, the German group.

Browne was hailed as the “takeover king of the international oil industry”, on a par with John D Rockefeller, the founder of the great – and rapacious – Standard Oil Trust, which dominated the American oil industry in the 19th century era of the American “robber baron” capitalists.

Then, to put the icing on the cake, Browne struck a risky but potentially hugely rewarding deal in Russia, creating a new joint venture, TNK-BP, that made BP the world’s second largest private sector producer of oil and gas.

Browne, fêted as the “Sun King”, at that time seemed unassailable. In eight or nine years at the helm of BP he had achieved more, so it seemed, than his predecessors had in 10 times as long. No chief executive of BP had exercised such complete personal dominance over the company since the 1950s.

Browne, building on strong foundations, was the architect of the modern BP and leaves a lasting monument to his leadership, albeit one now in need of some repair.

Dr James Bamberg is the author of BP’s official history and a research associate at the history faculty of Cambridge University

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/01/14/ccbrowne214.xml

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